Current Long Positions (stop losses in parentheses): VMW ($83.70), RRC ($44.59), ATVI ($11.93), APOG ($11.56), BIDU ($105.80)
Current Short Positions (stop losses in parentheses): DTV ($41.09), GOOG ($590.10)
Bias: 18% long
Economic Reports Due Out (times are EST): ICSC-Goldman Store Sales (7:45 a.m.), Redbook (8:55 a.m.), Consumer Credit (3 p.m.)
My Observations and What to Expect
* Futures were up strong.
* Asian markets were mixed, but European markets were up strong to the tune of 1%-2%.
* The S&P 500 opened above the critical 1,227 price level, which has acted as resistance from last month. This is a very strong indication that the market will manage to hold the day’s gains above the 1,227 level.
* For the time being, yesterday looks to be the short-term pullback we were looking for. If the market holds the gains today, and more importantly 1,227, we should see a multi-day rally from here before getting another pullback.
* There is not a lot of resistance in the near-term for the markets. A small bit of resistance at 1,255, but the more significant resistance levels lie around 1,270-1,290. So this market has a lot of room to run in the near term.
* Yesterday’s volume was very light, which is good for a pullback day.
* The current rally has the makings of what we saw back on Sept. 1, when the market rallied for over two months.
* Dip buying will continue to be the name of the game for traders.
* The U.S. dollar failed to hold the trendline and is positioned to move back down to its November lows.
* For the bears: Push the market below 1,227. Failure to do so will ignite a fury of stops.
* For the bulls: Do not break the session lows after the first hour of trading, at any point, and move well beyond the 1,227 level on strong volume.
Actions I Will Be Taking
* Will look to add some morning breakout plays to the portfolio today.
* Tightened the stop losses in DTV and VMware, Inc. (NYSE: VMW).
* Stopped out of The Finish Line, Inc. (NASDAQ: FINL) at $18.60 yesterday for a profit.
* Follow me in the SharePlanner Chat-Room today for all my live trades, including my day trades.
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